TurboTax

File with experts
File your taxes
Experts at your fingertips

An expert helps with your taxes, or does them for you
TurboTax Expert Full Service

TurboTax Expert Assist

TurboTax Self-Employed
Prior year taxes
File myself
File myself
Do it yourself

We'll guide you step-by-step
TurboTax Do It Yourself

TurboTax Self-Employed

TurboTax Desktop
TurboTax Free

Activate your product

Prior year taxes
Business
Business
Business taxes

Get your T2 corporate return done right, your way
TurboTax Business

TurboTax Business Desktop
Tax situations
Tax situations
Tax situations

Find extra guidance for your big life moves
For investors

For 25 and younger

For self-employed

For new to Canada

For life changes
Resources
Resources
Resources

Explore tax tools, get tips, and read reviews
Personal income tax calculator

RRSP savings calculator

Learning hub

TurboTax support (FAQ)

TurboTax community
Pricing

Level 1

Solved

Is my Nonqualified Deferred Compensation under code 409 to be listed as a 457 pension?

Forum|Forum|7 years ago
June 6, 2019
2 replies
0 views

How will TurboTax know that I paid all SS tax and Medicare upfront in 2016 when I retired, although compensation is paid over 20 years? I don't see any check or indication on my W2 indicating it is a retirement plan but I know it is a NQDC set up under code 409 as a Top-Hat Plan.

TurboTax Home & Biz Windows

Best answer by

This is not a 457b pension, that would be a Deferred Compensation plan

A Non-qualified Deferred Compensation is generally taken into account as wages for FICA (SS and Medicare) purposes at the time when the services giving rise to the compensation are performed, at which time employers are required to withhold and remit the FICA taxes which has happened in your case.

So everything was set up properly for you to receive your compensation over a period of time with only the income tax due. When you receive you W-2 there should not be any withholding indicated in box 4 and 6.

A

Anonymous

Answer

This is not a 457b pension, that would be a Deferred Compensation plan

A Non-qualified Deferred Compensation is generally taken into account as wages for FICA (SS and Medicare) purposes at the time when the services giving rise to the compensation are performed, at which time employers are required to withhold and remit the FICA taxes which has happened in your case.

So everything was set up properly for you to receive your compensation over a period of time with only the income tax due. When you receive you W-2 there should not be any withholding indicated in box 4 and 6.

howardnichols-op

Level 2

So why is TurboTax calculating additional medicare tax?

Level 15

If TurboTax is calculating additional Medicare tax, it is based on your income level and filing status.

There is an additional Medicare tax on wages and self-employment earnings for those who exceed these thresholds.

Married filing jointly - $250,000
Married filing separate - $125,000
Single - $200,000
Head of household (with qualifying person) - $200,000
Qualifying widow(er) with dependent child - $200,000

Click here for more information on this topic.

**Say "Thanks" by clicking the thumb icon in a post. **Mark the post that answers your question by clicking on "Mark as Best Answer"